Coupon clipping slips, but deal hunt here to stay

Despite loyal followers, usage declines 17% in 2012

Members of the Savvy Savers Coupon Clippers gather twice a month to swap their unwanted coupons for ones they want or need.

RALEIGH — The number of coupons used by Americans to stock their pantries plummeted in 2012 — down 17 percent.

After surging during the Great Recession, the old-fashioned savings tool seems to have lost favor among consumers. Or has it?

Coupon industry insiders disagree on whether the drop is an aberration caused by a poor mix of coupon offers in 2012 or whether it signals the beginning of the end of the paper coupon era.

“There’s a lot of discussion within the industry,” said John Morgan, executive director of the Association of Coupon Professionals, the coupon industry’s trade organization.

“The industry is not used to having double-digit [swings] either way,” Mr. Morgan said. “That’s a big deal. Historically, it has been slow single-digit [increases or decreases] either way.”

With an uneven economic recovery as the backdrop, coupon-clipping shoppers have taken notice.

Kim Maney, 38, of Apex, N.C., shops at multiple supermarkets and drugstores, follows coupon blogs, and takes advantage of double- and triple-coupon offers to stock her pantry. A lawyer, wife, and mother of a 2-year-old, Ms. Maney said she has noticed a drop in the quality of paper coupons.

“A quarter off toilet paper? Really? What am I going to do with that?” said Ms. Maney, who admits to being “horrified by the idea I’d have to give somebody full price for something.”

Last year, U.S. consumers redeemed 2.9 billion coupons on consumer packaged goods, which includes everything from cereal to toilet bowl cleaner. That’s according to the most recent tally by NCH Marketing, a Deerfield, Ill.-based company and one of the country’s major coupon clearinghouses. NCH is a division of Valassis, which publishes the Red Plum coupon inserts for newspapers.

The 17.1 percent drop in 2012 is even more dramatic considering the total number of coupons made available — paper and digital — remained steady at 305 billion.

Charlie Brown, vice president of marketing at NCH, attributes the decline to a calculated move by manufacturers to correct an “unusually high” redemption rate in 2011.

Coupon redemption reached 3.5 billion coupons redeemed in 2011, a 6 percent increase over the previous year and a 26 percent increase since before the recession.

During the worst of the economic downturn, Mr. Morgan said, “marketers ramped up [coupon offers] to protect their market share.”

In 2012, manufacturers put the brakes on coupons. The coupon values became skimpier, the expiration dates shorter, and often the coupons required that shoppers buy two or even three of an item before getting 55 cents off.

Manufacturers also issued more coupons for new products, which Mr. Brown said, “doesn’t have the same level of appeal.”

“For the manufacturer, the redemption of the coupon is an expense,” he said, so they purposely made the coupon offers less attractive. “They don’t want 100 percent of the coupons redeemed.”

Coupon shoppers Veronica Shores, 48, of Raleigh, and Michelle Morton, 42, of North Raleigh, have also noticed the decline in coupon quality and adjusted their shopping habits to compensate.

Ms. Shores is on a fixed income and has relied on coupons to help make ends meet. She attends local coupons swaps, where she meets with other coupon clippers thumbing through stacks of everyone’s cast-off coupons looking for the ones their families will use.

“They have really started dropping the coupon values,” she said at a recent monthly swap held at a library. “It makes it harder to save.” To supplement her coupon savings, she’s also using more store brands.

Ms. Morton has cut back on her coupon use. Raising three kids, she started wondering if her time clipping and organizing all those little slips of paper was time well spent.

“It got to be too overwhelming. It got to be where I was dreading it, cutting coupons and matching them to lists,” she said. “I started to kind of realize, ‘OK, is it worth my time?’ ” But that doesn’t mean Ms. Morton has abandoned her search for deals.

She now does a lot of her shopping at the no-frills grocery chain, Aldi, where most of the products are store-brand and coupons aren’t accepted. She hits a local supermarket for the best of the coupon deals.

Citing the competitive nature of their business, manufacturers wouldn’t discuss their coupon offerings. Jeff LeRoy, a representative for Procter & Gamble, declined to comment. “We consider coupon redemption information proprietary,” he said in an emailed statement.

Likewise, grocery chains don’t like to comment on coupon redemption.

Phil Lempert, a consumer analyst known as the Supermarket Guru, said he thinks the discussion about coupon expiration dates and lower coupon values, while valid, misses the point.

He argues that paper coupons, in particular, are an outmoded way of delivering deals to consumers, pointing out that only about 1 percent of all coupons are redeemed — even in a good year.

Mr. Lempert forecasts continuing drops in paper coupon redemption.

“We’ll continue to see people empowered to save money but not the way it used to be,” he said. “Look at how quickly we left our records, cassettes, and CDs. When’s the last time you wrote a real letter?

“Our smartphones are running our lives.”

Mr. Lempert plans to be blunt in his keynote speech to the Association of Coupon Professionals' annual meeting this month. “When you drop 17 percent in one year, you’re like the Titanic,” Mr. Lempert said. “You better get the lifeboats out or be ready to go down.”

Mr. Brown, the coupon clearinghouse executive, said his company doesn’t forecast coupon trends. But he did say he suspects manufacturers would be “adjusting the dial” on their coupon offerings for 2013.

Based on his company’s most recent consumer survey, he said consumers will continue to clip and save. Nearly 80 percent said they use coupons “always,” “very often,” or “sometimes.” That number has remained steady over the last several years.

Jackie Warrick, the president of CouponCabin.com, an online site that compiles coupons and coupon codes on everything from groceries to the latest electronic gadgets, said she believes coupon savings are here to stay, although perhaps in different forms.

“I think companies are working to try to find the right mix,” she said. “They definitely need to work on making coupons as hassle-free as possible.”

As of 2012, about 90 percent of all coupons were still distributed in coupon books, the vast majority delivered via the Sunday newspaper. Thus far, the so-called “click-to-card” digital coupons that shoppers load to their store loyalty cards have amounted to only about 1 percent of coupons distributed, and redemption is similarly small.

Traditional coupon clippers have been slow to adopt them, citing their limitations. The paperless coupons are typically only good on one purchase and are not doubled in value as paper coupons often are. For instance, if a shopper wanted to buy three boxes of cereal and had three 50-cent paper coupons, the shopper would realize a $3 savings. That same shopper, using digital coupons, would only save 50 cents off one box.

And at least one supermarket chain has addressed the complaint that digital coupons can only be used once. Kroger recently released a set of digital coupons that permitted shoppers to use each one up to five times.

Not all coupon clippers are ready to embrace digital discounts.

Ms. Morton, the mother of three who has streamlined her coupon use, said she has mixed feelings about the future of coupons. While she has no love affair with the paper versions, which frequently cause her guilt when she lets them go unclipped, she finds digital coupons have their own inconveniences. She occasionally loads digital coupons to her store loyalty cards but finds it difficult to remember to use them.

And while she has a smartphone, she hasn’t used it to score a deal. “I haven’t gotten into that yet,” she said.

Ms. Shores, the coupon clipper and swapper from Raleigh, said she’s not ready to hang up her scissors. She knows digital deals will eventually take over but she’s hopeful manufacturers will be sensitive to “old school” shoppers such as herself. She doesn’t have a smartphone and doesn’t really see one in her future.

“I would be very dismayed if I woke up one Sunday morning and I found there were no more coupons,” Ms. Shores said. “Coupons are like free money.”

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